Tennessee Colony is off of Farm Road 321 fourteen miles northwest of Palestine in northwestern Anderson County. The town was founded in 1847, when a large group of settlers from Tennessee and Alabama arrived in the area. They named the settlement Tennessee Colony after their home state. Early families included the Sheltons, Avants, Hanks, and Seaglers. The moist climate and fertile soil was suitable for growing cotton, and a number of cotton plantations prospered, including the Jackson Plantation, which became one of the largest plantations in East Texas. In 1851 a log school opened, and Grant Kersky was the teacher. A post office opened in 1852. The community experienced racial tensions in the years before and after the Civil War. In 1860, for example, two white men from Mississippi, named Cable and Wyrick, were accused of plotting a slave uprising. They were suspected of encouraging slaves to poison the town's water supply and kill most of the white citizens. Cable and Wyrick were quickly tried and hanged. In 1869 a man named Seymour arrived in town to open a black school, but settlers objected to this and forced him to leave. The first railroad arrived at nearby Palestine in 1872. In 1884 Tennessee Colony had three churches, a school, a steam gristmill, a cotton gin, and a population of 200. The population dropped over the next few decades, as businesses moved to Palestine. In 1914 Tennessee Colony had a population of 100. A few grocers and cotton gins served the area, and it had a telephone connection. During the twentieth century the town functioned as a small agricultural center. The population rose to 300 in 1927 but decreased throughout the 1930s. In 1941 it was 150. In 1965 the Texas Department of Corrections purchased 21,000 acres southwest of town, and construction began for the Coffield Unit, a medium-security prison facility designed to hold 2,000 prisoners. That year the population of Tennessee Colony was at an all-time high of 400. In 1984 a second prison facility, the Beto Unit, was completed. The prisons included factories for metal fabrication, concrete blocks, and highway signs. Agricultural and livestock operations were also conducted. From the 1970s through the early 1990s the population of Tennessee Colony remained at 120. In 2000 the population was 300. The town contained two historical markers: one honoring Tennessee Colony and one honoring the Tennessee Colony cemetery.